The UAE expects investment legislation allowing up to 100 per cent foreign ownership of onshore companies to be passed this year.

“We have a vision to optimise foreign investor shareholding in selected sectors,” Obaid al-Zaabi, CEO of the Securities & Commodities Authority, told a regulatory panel during an investment forum organised by Egypt-based EFG Hermes.

Al-Zaabi cited as a strong precedent an earlier federal government decision allowing foreign investors to own up to 20 per cent shares in government-backed telecoms service provider Etisalat.

However, he stopped short of specifying which sectors are likely to be opened up to 100 per cent foreign ownership.

Other securities and market regulators in the region favour a more gradual approach to foreign ownership.

Khaled al-Homoud, member of the Board of Commissioners at Saudi Arabia’s Capital Market Authority, does not expect the kingdom’s recently enacted policy allowing up to 49 per cent foreign ownership across sectors to change soon.

“The regulation allowing 49 per cent ownership is a major improvement in the regime itself,” he says. “We have not seen the need to open up ownership limitations beyond 49 per cent.”

He says the foreign ownership cap is necessary to protect the kingdom’s monetary policy and keep it aligned with policies prescribed by the Saudi Arabian Monetary Authority (Sama), the kingdom’s central bank.

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